If you are reading this article, chances are you know the inherent advantages of choosing the franchise route instead of diving into the start-up whirlpool or grinding yourself in a 9 to 7 rut.
It is as good as being an entrepreneur but without the overwhelming risk, uncertainty and regulatory weight that deter even the most ambitious entrepreneurs.
Here there is safety, stability and yet, all the independence that office zombies can only dream of.
The best time to be a franchisee
To add to that, no time can be better to be a franchisee but now. There is a wave of tax reforms, digital renaissance, regulatory changes, investment and economic events that are fuelling the franchise space with another year of strong momentum. The business outlook is stacked in favour of the franchise industry.
The franchise industry in India is growing at a rate of 30-35% per annum, and the sales turnover of the sector was recently valued at over US$7 billion. Food and beverage franchises form a major part of the franchise growth in India. One out of three food outlets in India is established through the franchise route. The other sectors witnessing a steady rise include retail, beauty, healthcare and education. With the rise of tourist destinations, the hospitality industry is also looking up.
Our cities and tertiary towns are reflecting a fresh spur of franchise growth. People and consumers are hungry for more cafes, showrooms and foreign brands that mark the iconography of new cultures, cults and consumerism.
If there was any good time to be a franchisee and enjoy growth and freedom together, it is
Follow these steps and you are good to go.
1. Research and validate the concept of the franchisor
Setting up a franchise business is about strategic and tactical decisions. First and foremost, one has to be sure of the sector and the concept. Validating the franchisor’s concept and approach is a crucial step before one can boil down an endless list of options to a select few. The short-listing process can be quite daunting and confusing. After all, even a simple category like sports shoes can have a number of brands and labels to choose from. This is a stage where one has to weigh in the leadership, the brand’s equity, track record, history, alignment with one’s core values, and type of market.
1.1 Does the brand suit you and your ways of operating a business?
Picking a popular brand can be easy and tempting. But this is not about tweeting on a meme. It is about a decision that you have to live with for a considerable time. The decision will drive the way you deal with customers and expand the market. If the brand is too quirky or dull for your personality, if the franchisor’s country’s values are not easy to comprehend or if the terms of engagement are too rigid for you, it is better to sideline the thorny ones right at the onset and commit your energies to something/someone that resonates better with you, your values and goals.
1.2 Know the expectations of the franchisor clearly
Remember that as a franchisee, you can be under pressure to generate a healthy turnover and shape the business into a success, irrespective of the market hurdles or industry constraints prevailing during the business operation. Be cautious and ready for the pressures, struggles, expectations and ethos that the brand would take you towards.
2. Shortlist and choose the best franchise
One of the prime considerations in the assessment of a suitable franchisor is the support a franchise is willing to provide. This involves all kind of assistance and infrastructure. Help with the customer leads and sales process. Design and talent on-boarding. Taxation, legal and regulatory facets. It can be about adequate marketing and branding support. Take help from repositories and pit-stops like Tobuz. Take note of total investment and returns with due consideration to initial and working capital. This may require you to spend time with proficient and seasoned market advisors or financial experts.
2.1 Speak to similar franchisees
Tap the minds of advisors on Tobuz.com and the network all around you. It is going to be an unpredictable ride at many levels, so speak to similar franchisees and try to learn from their experiences. They would have done the homework already and may be willing to share their insights with you and bring you up to speed with your own decisions.
3. Seal the deal
The part about signing the deal is not the one to be taken lightly or done in haste. It is vital for you and your franchisor to get into the tiny details and possible scenarios, well before the dotted line pops up. Do take time and expertise to wrap your head around the fine print and signing of various documents. If you want to leverage the legal acuity of some experts on Tobuz here, it would be wise to be pre-emptive and proactive rather than lazy and sorry.
3.1 Don’t forget that you are building a relation
This deal is going to affect and carve a relationship. It would be a business equation, but if both sides can navigate the negotiation and outline the deliverables well at this point, a lot of confusion and fire-fighting can be easily avoided at a later stage.
Remember what you came in here for – to be a leader and a catalyst for a brand for a potential market. You may have an excellent brand to piggyback on, but the franchisor is also looking hopefully at your shoulders to reach and expand a new terrain. Get going with the muscle of a stallion but keep your eyes sharp as an eagle and mind swift as a gazelle.
That will ensure that you fly free and high just as a promising, well-equipped and confident franchisee is supposed to.